Unearned Riches

Suppose Las Vegas found itself in a precarious position: one of their largest casinos was about to go bankrupt, and the city, looking out for itself, declared that this casino was too large to fail.

Los Angeles gamblers, shocked by high fuel prices, were electing not to blow their rent money driving to Las Vegas, instead choosing local Indian gambling halls. And as the mortgage meltdown more or less snuffed out Vegas' largest economic engine (i.e., the building and servicing of their 35-mile radius suburban shithole), gambling was all that was left.

Gambling, the only economic activity left and with no out-of-towners, had to be played by locals only. And as their only economy, the casinos had to lend the citizens money to play. But this couldn't be sustained; eventually, the casinos would have to declare bankruptcy, but if they did, the city would implode (gambling is the economy, stoopid!).

So the City of Las Vegas held a vote, and the voters voted to tax themselves to bailout the casinos. Of course, all the two-bit casinos off the strip were allowed to fail, but the MGM...no way. The Bellagio...no way. Their stock rose 42% and 36% respectively following the announcements. Their CEOs were replaced by agents of the city, of course, but not without handsome severances.

Knowing that gambling is the only economy and that (collectively) gamblers always lose, each person then decided that their only way out was to pray they'd hit the big one. A few winners and a whole lotta losers.

Nothing new, just following the standard script, the American ethos of unearned riches. We expected this during the .com boom, the commodities boom, and the housing boom. Perhaps all we have left to look forward to is a gambling boom.